On Sunday, Stifel analyst Stephen Gengaro raised Tesla (TSLA.O)'s stock price target from $287 to $411 and maintained a 'buy' rating.
Tesla's stock price opened higher in the new week, with two factors regarding autonomous vehicles at play.
The electric vehicle manufacturer's stock price increased by 3.5%, closing at $357.09, while the S&P 500 index rose by 0.2%, and the Dow Jones Industrial Average fell by 0.3%.
According to Dow Jones market data, Tesla's closing price has reached a new 52-week high, also the highest closing price since April 2022.
Tesla is gaining support from multiple fronts. First is Wall Street's backing. On Sunday, Stifel analyst Stephen Gengaro raised Tesla's stock price target to $411 and maintained a 'buy' rating.
"We believe that buying Tesla stock requires foresight and patience, and a willingness to accept volatility," Gengaro wrote. He is not wrong; Tesla's stock price has always been highly volatile. As of Monday's trading, the stock price has risen about 37% since the November 5 elections, accounting for nearly all of this year's gains.
This move comes amid unchanged earnings expectations for 2025. Investors are betting that CEO Elon Musk's close relationship with elected President Donald Trump will benefit the electric vehicle manufacturer. One possible way is if a federal standard is established to regulate the use of autonomous vehicles, which would facilitate the introduction of robotic taxi services. Tesla plans to launch its autonomous robotic taxi service by the end of 2025.
"While we are confident in Tesla's automotive business, its AI-based fully autonomous driving capabilities and the immense value creation potential of Cybercab support our positive outlook on the company's prospects," Gengaro stated.
According to FactSet data, his price target has now become the highest on Wall Street, with Tesla's stock valued at approximately $1.3 trillion.
In addition to Gengaro's upgrade, Roth analyst Craig Irwin raised Tesla's stock rating from 'hold' to 'buy', with a price target increased from $85 to $380. The difference of $295 represents approximately $950 billion in market value.
Irwin wrote in his Monday report: "The world has changed." He believes that Musk's relationship with Trump and AI computing will bring about a new wave of growth.
"Musk's genuine support for Trump may double Tesla's fan base," Irwin said. "CyberTaxi now faces a favorable regulatory environment. Tesla's main AI task is [autonomous driving], a smarter co-pilot designed to handle more chaos than other products, and to support the humanoid robot program."
With the rating upgrades, 42% of analysts give Tesla stock a 'buy' rating. The average buy rating ratio for stocks in the S&P 500 is about 55%. The average analyst price target for Tesla stock is approximately $248.
With improving sentiment on Wall Street, Tesla Vice President Ashok Elluswamy posted on the X platform last Saturday evening that Tesla's highest level driver assistance software version 13 (called Full Self-Driving, FSD) is being rolled out to customers.
Most users of the FSD software paying $99 a month are still using the FSD version that starts with the digit 12.
The new version "upgraded the entire end-to-end driving network," part of the release notes stated. Elluswamy's post prompted a response from Musk: "It’s alive!"
In November, Musk stated that by early 2025, FSD should outperform human drivers, and the company plans to launch robotic taxi services later in 2025.
Tesla uses AI computing to train its autonomous driving cars. Wedbush analyst Dan Ives values the company's opportunities in AI and autonomous vehicles at $1 trillion.
He gives Tesla stock a 'buy' rating with a price target of $400. This is currently the second-highest target price for Tesla stock, according to FactSet data.
Ultimately, Tesla bulls hope the stock price will break through the current record closing price of $409.97, set on November 4, 2021. Tesla's record intraday high was $414.50, also set on the same day.
Article reposted from: Jin Ten Data